It’s that time of year when small businesses are looking at health benefits for the new year and evaluating options. During this renewal season, smaller businesses are in an interesting position. Businesses with fewer than 50 employees are not mandated by the Affordable Care Act (ACA) to offer traditional health insurance. When it makes sense, there are alternatives that employers can offer in lieu of traditional medical insurance.
- Level Funded Premium
Appears as a hybrid between a traditional small group health plan and self-funded concepts typically reserved for large businesses. Small businesses can cover their employees on their own with the added security blanket of a stop-loss policy from an insurance carrier that handles the plan’s administration and excess risk above a certain limit. All a business has to do to provide this type of coverage is simply set aside the cash to cover the anticipated claim expenses. Monthly premiums remain the same during the whole year, and if claims are less than the funded amount, a rebate or credit is issued at the end of the year. On the other hand, if claims go over the funded amount, the business is protected by the stop-loss policy.
- Health Reimbursement Accounts
A simple approach to offering employee health benefits – reimburse premiums instead of paying them. A Small Business HRA is a viable option for small businesses because it removes many of the barriers of offering traditional health insurance, such as minimum participation and minimum contribution requirements.
- Deductible Subsidies
Employers can contribute to an employee’s deductible expenses by contributing to an HRA or an HSA. With an HSA in 2018, employers can only contribute up to $3,450 for single employees and $6,900 for employees with families.
- Concierge Medical Services
In a Direct Primary Care or Concierge Medical Services agreement, doctors don’t take insurance. Instead, they promise personalized care while charging a flat fee on a monthly or yearly basis. The monthly fee includes basic medication, lab tests and follow-up visits in person, over email and by phone.
- Healthcare Share Ministries
Each month you pay the same amount you agree to as your “monthly share” (akin to a premium in the health insurance world.) Then that money is allotted to other members who have a need to pay a medical bill. Know that this process varies from ministry to ministry, and has been met with mixed reviews.
We are waiting on a presidential announcement, set to be tomorrow, 10/4/2017, regarding association health plans which would allow small businesses that belong to a trade or professional association to pool together across state lines and buy health coverage. More info to come on that alternative after the announcement!